Trains delivering oil to Washington refineries

Posted: November 27, 2012 - 1:01am

THE ASSOCIATED PRESS

TACOMA, Wash. — The oil boom in the Great Plains states is affecting refineries, ports and other businesses in Washington.

Oil trains are delivering crude to refineries in the state as Alaska’s production falls. And, there are proposals to export oil from the Port of Grays Harbor to West Coast refineries and possibly Asia.

A 103-car oil train that arrived from North Dakota last week was the first of what’s expected to be weekly trains at a new $8 million rail yard at the U.S. Oil refinery in Tacoma, The News Tribune reported Sunday.

Trains also are delivering oil from North Dakota and Montana to the Tesoro refinery near Anacortes, which recently completed a $55 million rail yard. BP has applied for permits for a $60 million rail yard at its Cherry Point refinery north of Bellingham.

The refineries still process crude oil from Alaska and other sources. The Tesoro refinery has the capacity to receive 50,000 barrels of crude oil a day by rail, but its total capacity is 120,000 barrels a day.

The BP refinery would receive about 20,000 barrels a day by rail, less than a tenth of its 234,000 barrel capacity. “So North Slope and other crudes shipped by tanker will remain its primary source of oil,” BP said in a statement.

U.S. Oil spokeswoman Marcia Nielsen said it’s shifting some of its feedstock procurement to the Great Plains because of better availability and price.

Shipping oil on a 1,200-mile “pipeline with steel wheels” adds to the cost, but it would take years to build new pipelines and pumping stations.

Meanwhile, The Daily World in Aberdeen reported Monday that two companies want to export crude oil from the Port of Grays Harbor on the Washington coast.

Westway Terminals plans to build two more tanks at the port where it currently exports methanol. Its permit application to the city of Hoquiam said it could handle near 10 million barrels a year, or about 128 trains a year.

Another company, US Development, is looking at the port’s Terminal 3 to load oil from trains onto ships.

Both proposals have drawn opposition from citizen groups that were formed to oppose a coal export terminal. Friends of Grays Harbor and Citizens for a Clean Harbor are concerned about the risk of spills and the impact of train traffic.

The Port of Tacoma also has received proposals for a bulk liquids handling facility on the former Kaiser aluminum smelter site on Blair Waterway.

Port spokeswoman Tara Mattina told The News Tribune she could not discuss proposals because of ongoing negotiations.

The new oil fields are affecting the Northwest in other ways. The biggest beneficiary is Burlington Northern Santa Fe, which owns most of the rail lines across the northern United States between Puget Sound and Chicago.

The Port of Olympia has found new business importing oil field supplies, including special sand used in the hydraulic fracturing drilling process.

The Bradken foundry in Tacoma is expanding to make large metal castings used in the energy industry.